Alcon's independent directors must be grinning, now that the company has posted street-beating second-quarter earnings. Not only did the eye care company report a 15 percent jump in Q2 profits, but also hiked its outlook for the full year. That's giving ammunition to the directors fighting for a higher buyout bid from Novartis.
Indeed, the independent director committee (IDC) used the numbers to pester Novartis to raise its price. "We encourage Novartis to recognize the company and its employees for their efforts and reflect it in Novartis' valuation of Alcon's minority shares," IDC Chairman Thomas Plaskett said in a statement.
And at least one analyst concurs. "We maintain our view that Novartis will need to improve its offer to Alcon minority shareholders," Vontobel's Andrew Weiss told Reuters. "We expect the price will be around the levels Novartis paid Nestle for its 77 percent stake."
Novartis is in the midst of acquiring 77 percent of Alcon in a two-stage deal. It also wants the remaining 23 percent--held by the minority shareholders--and has made an offer for those shares, but that offer is much lower in value than the Swiss drugmaker's price for Nestle's majority stake. The IDC has been fighting for more, even setting aside money for a possible court fight. Novartis has been standing firm.